When you begin the home buying or selling journey, there may be several terms used that you’re unfamiliar with. Buyer’s market? Seller’s market? Balanced market? What’s the difference, and how will it affect you?
Depending on whether you’re buying or selling a home, one kind of market may be more favourable to you than the other. To help get you started, we’ve broken down the differences between a buyer’s market and a seller’s market below and the pros and cons of each.
What Is A Buyer’s Market?
A buyer’s market is when more houses are for sale than buyers. This happens when the housing market is slow and people are not buying or selling as much as they usually would. Because of this, prices will typically be lower in a buyer’s market. If you’re looking to buy a house, this is good news. You will likely be able to negotiate a lower price.
What Is A Seller’s Market?
In contrast to a buyer’s market, a seller’s market is when there are more buyers than houses for sale. This happens when the housing market is booming, and people buy and sell homes like crazy. Because of this, prices will typically be higher in a seller’s market. This is excellent news for you if you’re looking to sell your house fast and for a profit. Because of competitive buyers, you’ll probably be able to negotiate a higher price for your home.
What Is A Balanced Housing Market?
A balanced housing market is when an equal number of buyers and houses that are for sale. This happens when the housing market is just right – not too hot and not too cold. If you’re looking to buy or sell a house, this is a good time to do it. You won’t have to worry about overly high selling prices or buyers trying to low-ball you.
For more information on the nuances of a balanced market, check out What Is A Balanced Market & How Does It Affect Buyers And Sellers?
How Can I Tell Which Market I’m In?
There are a few key indicators that you can look at to determine whether you’re in a buyer’s market or seller’s market.
- The housing inventory: This is the number of houses for sale in your area. If there are more houses for sale than buyers, you’re in a buyer’s market. If there are more buyers than houses for sale, you’re in a seller’s market.
- The housing prices: This is the average price of homes in your area. If prices are rising, you’re likely in a seller’s market. If prices are falling, you’re likely in a buyer’s market.
- The days on the market: What is the average number of days it takes for a house to sell? If homes are selling quickly, you’re in a seller’s market. If properties are sitting on the market for months, you’re in a buyer’s market.
If you’re unsure which kind of market your local housing market is currently in, ask your Port Alberni REALTOR®.
Pros And Cons Of A Buyer’s Market
There are both good and bad things about being in a buyer’s market. If you’re looking to buy a house, the pros include:
– Lower prices
– More negotiation power
– More houses to choose from
However, if you’re hoping to sell your house, you may encounter some challenges. The cons include:
– Fewer bidding wars
– Selling your house may take longer
Pros And Cons Of A Seller’s Market
There are also positive and negative aspects of a seller’s market. The advantages this kind of market for selling your property include:
– You can ask for a higher price
– Your house will sell faster
– Bidding wars are more common
However, if you’re hoping to buy a property, you’ll likely come across these cons:
– Homes are more expensive
– Homes spend less time on the market – you have to act fast
So, Which Housing Market Is Better – Seller’s or Buyer’s?
There is no correct answer to this question. It all depends on what you’re looking for. If you’re looking to buy a house, you’ll want to be in a buyer’s market so that prices are lower. If you’re selling and want to get a higher price for your home, you’ll want to be in a seller’s market.
There you have it! That’s all you need to know about the difference between a buyer’s market and a seller’s market. As you can see, each housing market has its own pros and cons depending on whether you’re buying or selling. It’s also worth noting that housing markets can change quickly. One minute you may be in a buyer’s market, and the next, you may be in a seller’s market. That’s why it’s essential to stay up-to-date on your area’s latest housing market trends. Don’t hesitate to ask your real estate agent for advice.